Commodity Payments, Farm Business Survival, and Farm Size Growth
By Nigel Key and Michael J. Roberts
Economic Research Report No. (ERR-51) 47 pp,
November 2007
In the last 25 years, U.S. crop farms have steadily declined in number and grown in
average size, as production has shifted to larger operations. Larger farms tend to receive
more commodity program payments because most payments are tied to a farm’s current
or historical production, but whether payments have contributed to farm growth is
uncertain. This study uses farm-level data from the census of agriculture to determine
whether there is a statistical relationship between farm commodity program payments
and greater concentration in production. The analysis indicates that, at the regional
level, higher commodity program payments per acre are associated with subsequent
farm growth. Also, higher payments per acre are associated with higher rates of farm
survival and growth.
Keywords: agricultural economics, farm commodity payments, commodity program, producers, cropland, crops, farm structure, cropland concentration, production, census of agriculture, agricultural payments, farm size, farm survival, consolidation, ERS, USDA
In this report ... Chapters are
in Adobe Acrobat PDF format.
- Abstract, Acknowledgments, Contents, and Summary, 81 kb.
- Introduction, 53 kb.
- Determinants of Farm Size and Survival, 33 kb.
- Rapid Growth in Land Concentration, 76 kb.
- Commodity Program Payments and the Concentration of Cropland, 333 kb.
- Effect of Payments on Growth and Survival of Farms, 72 kb.
- Summary and Discussion, 40 kb.
- References, 42 kb.
- Appendix, 53 kb.
Updated date: November 27, 2007
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